Corporate & Securities Law

When $975/hr is Value Pricing

By John Wallbillich

Sometimes billing by the hour beats the alternative.

Yesterday’s Washington Post profiled (reg reqd) Robert Barnett of Williams & Connolly. Mr. Barnett has a virtual hammerlock on representing high-profile political and public figures who want to add “author” to their resume.

It’s a two step approach:

1. Find a niche that’s being over-charged:

Barnett’s rate of $975 an hour is a lot of money, but his transformational insight was to apply a lawyer’s fee structure to the work of an agent. Then it’s not necessarily so much money.

2. Realize that fee and hourly rate are not the same.

A traditional literary agent charges 15 percent of an advance. Barnett helped Bill Clinton sell “My Life” for a record $15 million. Clinton would have paid an agent $2.25 million; Barnett says he put in far fewer hours than the 2,308 he would have needed to work to bill $2.25 million.

His clients can do the math. “For someone like me, the savings are extraordinary,” author (James) Patterson says.

Mr. Barnett is certainly an exceptional lawyer with a unique practice.

But this part of his practice shows that billing by the hour can qualify an alternative fee arrangement.

Full post as published by The Wired GC on March 08, 2010 (boomark / email).